CFWAD wrote:https://www.latimes.com/business/story/ ... up-airline
Part of my concern with Avelo is their future plans. What they are doing right now is fine. Leasing cheap/last generation aircraft and stimulating traffic demand after a once in a century downturn. But was is their plan going forward? What is their fleet plan? What is their route strategy?
DN @ Breeze has at least a reasonable plan and capital to fund going forward. Avelo seems like it will fall by the wayside like Direct Air in the 90's. No clear direction, no solid financial backing or future business plan. Once fuel goes up and travel demand follows - this airline is done. Their best hope is to start filling the charter gap for Military and sport teams.
Where do you get "no solid financial backing"? Avelo raised $125mm from investors, which seems as much or more than Breeze raised.
Also, their plan appears to be every bit as clear as Breeze's, except for maybe the fleet plan, and that's because Breeze has committed to a large orderbook, whereas Avelo appears to be playing the used spot market. From the linked article above:
"Levy’s is focused on shorter-distance routes connecting smaller airports with domestic leisure markets[...]
“We’re going to grow at a measured pace,” said Levy, a co-founder of Allegiant Travel Co., which specializes in leisure travel from smaller markets to vacation destinations such as Florida and Las Vegas. “We’re going to build the company a little bit like Allegiant, slowly and steadily,” [...]
The new airline will make its business from “a small, small niche” of air travelers who are price sensitive and eager to avoid large, congested airports. “But in the U.S. market even a small niche can be a large opportunity,” he said."
Seems that they are executing on the strategy that was laid out over a year ago: smaller, less congested airports (BUR, HVN) to leisure markets, at a relatively slow, measured pace.